While target-date funds' international equity allocations generally have risen in the past five years, the median allocation remained "fairly static" in 2017, Mercer said.

The median allocation for 2017 is below the non-U.S. equity component of the MSCI All Country World index, which is 47.8%, Mercer noted.

In discussions with target-date managers on their equity allocations, Mercer said its researchers found many have continued to display U.S. equity bias because plan participants have a natural home-country bias, many of their target-date peers have home-country bias, and the presence of "some evidence that U.S. equities have displayed less downside risk in times of stress than international equities."

Mercer's report also looked at the growth of target-date funds in general and found assets rose $1.7 trillion in 2017, up 30.8% from 2016, and up 54.5% from 2015.

The report found that the overall allocation to growth assets has remained largely unchanged over the past year "ignoring the natural reduction expected from the progression of the glidepath."

Looking at vintage years, assets peaked in 2030 vintages and declined in 2025 and 2020 vintages, the report found. The decline in 2025 and 2020 vintages was more pronounced in 2017 than 2016, which could indicate that older participants are moving out of target-date funds before retirement, Mercer's report said, adding previous studies also have suggested that could be the case.